Question

Which of the following statement is incorrect about Preference Shares?

Options

• Right to receive Dividend

• No Dividend

• Return of capital on winding up of company

• Can be converted

Answer 1

No Dividend

Explanation:

Preference Dividend-paying shares are ones on which a fixed amount of dividend will be paid. Preference shareholders receive dividends before equity stockholders receive dividends. These shares are redeemable and convertible.